National statistics

Local authority revenue expenditure and financing: 2022-23 outturn, England - second release

Published 14 December 2023

Applies to England

Key statistics

Net current expenditure on services

• Local authorities’ total net current service expenditure was £113.5 billion in 2022-23. In real terms, this was 0.6% lower compared to 2021-22.

• Total Service Expenditure excluding Education Services totalled £76.4 billion in 2022-23. This was £618 million (-0.8%) lower in real terms compared to 2021-22, and 10.5% higher than in 2019-20.

• The categories of services with the largest changes in net current expenditure compared to 2021-22 were (in real terms):

  • Highways and transport: £908 million (-16%) lower than in 2021-22. This was largely due to lower expenditure by the GLA (£840 million lower than in 2021-22). This was nevertheless 14% (£586 million) higher in real terms than in 2019-20.

  • Children’s Social Care: +£783 million (+6.5%) to £12.8 billion.

Revenue Expenditure

• The broader measure of local authority Revenue Expenditure (see Definitions section) totalled £117.4 billion across all local authorities in England in 2022-23. In real terms, this is 1.0% lower than 2021-22 and 7.1% higher than in 2019-20.

Revenue Account Reserves

• Revenue Account non-ringfenced reserves are estimated to have totalled £31.6 billion at 31 March 2023. This is a decrease compared with £33.4 billion at 1 April 2022, but is still substantially higher than £23.5 billion at 31 March 2020.

Release date: 14 December 2023
Responsible Statistician: Gavin Sayer
Contact: lgf1.revenue@levellingup.gov.uk
Media enquiries: NewsDesk@levellingup.gov.uk

Introduction

Local government expenditure accounts for around a fifth of all government spending and the majority of this is shown in local authorities’ revenue accounts.

This statistical release, and all its associated tables, presents the second release of outturn data on the revenue expenditure of local authorities in England for the financial year 2022-23. These are based on data from 403 (95%) of 426 local authorities in England in 2022-23 and use estimation to provide totals for England and for classes of local authority. This compares with the response rate of 343 (81%) in the first release in October 2023. As well as including the data of these additional 60 local authorities, updated figures provided by other authorities are included too. The estimated England totals are similar to those of the first release for most data items; tables 2a, 2b, 4a and 4b include the figures for 2022-23 from the first release.

All the data in the release are compiled from the Revenue Outturn (RO) returns submitted by local authorities in England to the Department for Levelling Up, Housing and Communities. Coverage includes, but is not limited to, local councils. i.e. London Boroughs, Metropolitan Districts, Shire Counties, Shire Districts and Unitary Authorities, as well as other type of local authority types: police, fire, waste, park and combined authorities, and the Greater London Authority.

Definitions of terms used in this release can be found in the accompanying Technical Notes document. The full data collections forms and guidance notes can be found in the forms section of our website.

Key contextual information

Functions and responsibilities of local government can change from year to year, so comparisons between financial years may potentially not be wholly valid. Where major changes occur, these are noted.

Figures in this report, and the associated tables and reports, are shown as net current expenditure. So, for example, a decrease may be driven by a decrease in expenditure or by an increase in fees or other income relating to that category of services, and conversely.

Impact of COVID-19

As a result of the impacts of COVID-19, local authorities received various additional grants in 2020-21 and 2021-22. In the summary tables within this statistical release, we have adjusted totals for grants and reserves to remove those effects that are just due to timing to make the figures as comparable over time as they can be.

These adjustments related to grants paid in March 2020 and to COVID business rate reliefs grants paid in 2020-21 and 2021-22, and where these were held in reserves until used. These are explained in the section ‘Revenue Expenditure Financing’.

Imputation for missing returns

As at the cut-off for inclusion in this publication, 23 of 426 eligible local authorities had not yet provided data. England totals have been estimated by also drawing: i) on grant allocation data, where this was known, and ii) for other data items, on the proportions within the previous year’s outturn data.

The full data submitted by local authorities, including financing and reserves items, can be found by following the link to the ‘2022 to 2023 individual local authority - outturn’ data tables.

New data items in 2022-23

The changes to the data collected in the Revenue Outturn 2022-23 are detailed at: Changes to the RO forms from 2023

The most noteworthy changes were:

• New data items recording the expenditure on agency staff for each of the 13 broad service categories

• Additional categories for looked after children in the Children’s Social Care section (RO3) for which provisional England estimates have now been produced.

• Less grouping of categories in the Subjective Analysis Return (this is collected from a sample of local authorities and the output of this is usually published with the second release of Revenue Outturn only.)

Subjective Analysis Return 2022-23 part A has been published with this release. The data reported by local authorities for parts B & C are undergoing further validation and their publication is expected by February 2024.

Publication of more granular data on grant income reported by local authorities in RO2022-23 is planned for early 2024.

Engagement with users and future enhancements

A Review of Local Government Finance Statistics was carried out in 2021. Consequently, there are plans for some additions to the data collected and how the data are disseminated. These are to include multi-year data sets.

We are keen to know about the various uses to which these data are put. Therefore, please be in touch to tell us briefly, and with comments and suggestions by emailing lgf1.revenue@levellingup.gov.uk.

Local authority expenditure

Most local authority spend is on the provision of services. The Revenue Outturn data records current expenditure by detailed categories of service, and these sum up to ‘Total Service Expenditure’.

‘Revenue Expenditure’ also accounts for any costs, notably those which do not fall wholly within the financial year, but which are charged to the year’s account. Most of these costs relate to repayment and management of debt, financing capital and grants that authorities receive on behalf of a third party.

Tables 1a and 1b provide a summary of the key expenditure lines for all authorities in England for the last five years in cash terms and adjusted for inflation respectively.

Expenditure by service

Service Expenditure is classified under twelve main categories of service type, such as Education, Adult Social Care and Public Health, plus an ‘Other Services’ category catching all expenditure that authorities are unable to allocate to specific areas.

Tables 1a and 1b also show a five-year time series of Total Service Expenditure and Revenue Expenditure. Tables 2a and 2b provide a more detailed breakdown of the components of each expenditure category for all local authorities in England for 2021-22 and 2022-23.

Tables 1a and 2a show figures in cash terms (i.e. not adjusted for inflation) whereas tables 1b and 2b show figures adjusted for inflation (i.e. adjusted by the widely-used and general purpose GDP deflator. This converts all amounts in tables 1b and 2b into 2022-23 prices.) The adjustment for inflation is more significant in 2022-23 than in previous years, with the GDP deflator’s value being at 6.7%, compared to around 2% over the previous six years. While overall expenditure is up in cash terms, it is slightly down in real terms.

Total Service Expenditure for all local authorities in England was £113.5 billion in 2022-23, a decrease of £657 million (-0.6%) in real terms compared to 2021-22.

Expenditure by local authorities on the Education service category decreased over 2010s due to the ongoing change in status of local authority schools to centrally funded academies. As such, figures on expenditure on education services are not comparable over time. Consequently, excluding Education from Total Service Expenditure, provides a fairer year-on-year comparison.

Total Service Expenditure excluding education services for all local authorities in England was £76.4 billion in 2022-23. This was £618 million (-0.8%) lower in real terms compared to 2021-22, and 10.5% higher than in 2019-20.

The largest components of change in (net current) service expenditure (in real terms) from 2021-22 to 2022-23 were as follows:

i) Highways and transport: at £4.8 billion in 2022-23, this was £908 million (-16%) lower than in 2021-22. This was largely due to lower expenditure by the GLA (£840 million lower than in 2021-22). For both the GLA and the total for all other local authorities in England, the level of net current expenditure on Highways and Transport in 2022 23 remained higher than prior to the COVID-19 pandemic; overall 14% (£586 million) higher in real terms than in 2019-20.

ii) Children’s Social Care: increased by £783 million (+6.5%) in real terms to £12.8 billion.

iii) Public health services: At £3.9 billion in 2022-23, this was £664 million (-14.7%) lower in real terms than in 2021-22, and £249 million (+6.9%) higher than in 2019-20.

Table 1a:
Service expenditure net of sales, fees and charges and of other income [Note 1], 2018-19 to 2022-23 (cash terms)

£ million – not adjusted for inflation

Service Category	2018-19	2019-20	2020-21	2021-22	2022-23
Education [note 2]	32,233	32,603	33,410	34,839	37,125
Highways and transport [note 3]	3,857	3,757	7,844	5,331	4,779
Highways and transport (GLA only)	1,227	1,003	4,280	2,337	1,653
Social care [note 4]	25,452	26,826	29,209	30,242	33,322
of which: Children’s Social Care	9,375	9,920	10,496	11,270	12,805
Public Health	3,278	3,228	3,792	4,232	3,851
Housing (excluding Housing Revenue Account)	1,673	1,775	2,051	2,179	2,274
Cultural, environmental and planning	8,435	8,757	10,107	10,008	10,689
Police	11,426	12,203	13,083	13,607	14,618
Fire & rescue	2,005	2,158	2,194	2,267	2,423
Central services	3,011	3,251	4,077	4,091	4,275
Other Services	48	42	519	255	184
Total Service Expenditure	91,417	94,600	106,284	107,051	113,540
% Difference Year-on-year	1.8%	3.5%	12.4%	0.7%	6.1%
Total Service Expenditure excluding Education [note 5]	59,183	61,997	72,874	72,212	76,415
% Difference Year-on-year	2.9%	4.8%	17.5%	-0.9%	5.8%
Total Service Expenditure excluding Education & Public Health	55,905	58,769	69,082	67,980	72,564
% Difference Year-on-year	3.2%	5.1%	17.5%	-1.6%	6.7%
Revenue Expenditure	94,226	98,178	109,639	111,177	117,370
% Difference Year-on-year	1.2%	4.2%	11.7%	1.4%	5.6%

Notes:

1. Other income includes, for example, significant funding for Adult Social Care from the NHS such as via Better Care Fund pooled budgets.
2. Expenditure on education services is not comparable between years due to a number of schools changing their status to become academies, which are centrally funded rather than funded through local authorities.
3. Much of the higher highways and transport expenditure during 2020-21 and 2021-22 can be attributed to the increase in grants to Transport for London, which arose as a result of lower fare income during the COVID-19 pandemic. Parking income was also significantly down in many authorities in 2020-21.
4. Adult Social Care is not shown separately since figures exclude expenditure financed from the NHS, such as through the Better Care Fund. Equivalent figures including this are produced in NHS England’s Adult Social Care - Activity and Finance Report which were first published in October 2023 and updated on 07/12/2023 without the exclusions noted.
5. Education is excluded to provide a fairer year-on-year comparison as it is not comparable over time due to schools converting to academies and thus becoming directly funded.

Table 1b:
Service expenditure net of sales, fees and charges and of other income [Note 1], 2018-19 to 2022-23 (real terms)

£ million – adjusted for inflation, in 2022-23 prices

Service Category	2018-19	2019-20	2020-21	2021-22	2022-23
Education [note 2]	36,818	36,381	36,451	37,164	37,125
Highways and transport [note 3]	4,406	4,193	8,558	5,687	4,779
Highways and transport (GLA only)	1,402	1,119	4,669	2,493	1,653
Social care [note 4]	29,071	29,934	31,868	32,261	33,322
of which: Children’s Social Care	10,709	11,070	11,451	12,023	12,805
Public Health	3,744	3,602	4,138	4,515	3,851
Housing (excluding Housing Revenue Account)	1,910	1,980	2,238	2,324	2,274
Cultural, environmental and planning	9,634	9,771	11,027	10,676	10,689
Police	13,051	13,617	14,274	14,515	14,618
Fire & rescue	2,290	2,409	2,393	2,419	2,423
Central services	3,439	3,628	4,448	4,364	4,275
Other Services	54	47	566	272	184
Total Service Expenditure	104,418	105,561	115,960	114,197	113,540
% Difference Year-on-year	-0.3%	1.1%	9.9%	-1.5%	-0.6%
Total Service Expenditure excluding Education [note 5]	67,600	69,180	79,508	77,033	76,415
% Difference Year-on-year	0.7%	2.3%	14.9%	-3.1%	-0.8%
Total Service Expenditure excluding Education & Public Health	63,856	65,579	75,371	72,518	72,564
% Difference Year-on-year	1.1%	2.7%	14.9%	-3.8%	-0.1%
Revenue Expenditure	107,627	109,555	119,620	118,598	117,370
% Difference Year-on-year	-0.9%	1.8%	9.2%	-0.9%	-1.0%

Notes:

1. Other income includes, for example, significant funding for Adult Social Care from the NHS such as via Better Care Fund pooled budgets.
2. Expenditure on education services is not comparable between years due to a number of schools changing their status to become academies, which are centrally funded rather than funded through local authorities.
3. Much of the higher highways and transport expenditure during 2020-21 and 2021-22 can be attributed to the increase in grants to Transport for London, which arose as a result of lower fare income during the COVID-19 pandemic. Parking income was also significantly down in many authorities in 2020-21.
4. Adult Social Care is not shown separately since figures exclude expenditure financed from the NHS, such as through the Better Care Fund. Equivalent figures including this are produced in NHS England’s Adult Social Care - Activity and Finance Report which were first published in October 2023 and updated on 07/12/2023 without the exclusions noted.
5. Education is excluded to provide a fairer year-on-year comparison as it is not comparable over time due to schools converting to academies and thus becoming directly funded.

The figures in the tables of this document are, with the exception of tables 3a and 3b, net of sales, fees and charges, and net of other service-specific income (but not net of grants from Central Government). Other Income includes, for example, significant funding for Adult Social Care from the NHS such as via Better Care Fund pooled budgets.

To reflect the full extent of public expenditure on Adult Social Care, it is necessary to consider funding from the NHS in addition to net current expenditure by local authorities.

NHS Digital’s Adult Social Care Activity and Finance Report 2022-23 was published in December 2023 (data tables published on 19th October 2023), and this reports financing of local authority adult social care expenditure from the NHS totalling £4.0 billion in 2022-23.

Revenue Expenditure

Tables 2a and 2b provide a more detailed breakdown of the components of service expenditure categories by local authorities in England for 2021-22 and 2022-23, as well as for other elements of Revenue Expenditure.

Table 2a:
Revenue Expenditure components Summary, England, 2021-22 and 2022-23

£ million - not adjusted for inflation

Service Category	Net current expenditure [Note 1] 2021-22 final	Net current expenditure [Note 1] 2022-23 first release	Net current expenditure [note 1] 2022-23 second release	Actual change between 2021-22 and 2022-23	Percentage change between 2021-22 and 2022-23
Education services	34,839	37,212	37,125	2,287	6.6
Highways and transport services (excl. GLA)	2,994	3,083	3,125	132	4.4
Highways and transport services (GLA only)	2,337	1,653	1,653	-684	-29.3
Children’s Social Care services	11,270	12,785	12,805	1,535	13.6
Adult Social Care services	18,972	20,570	20,517	1,545	8.1
Public Health services	4,232	3,872	3,851	-381	-9.0
Housing services (excluding Housing Revenue Account)	2,179	2,240	2,274	95	4.3
including:
Homelessness         Reduction Act         duties	314	368	367	53	17.0
Homelessness:         all other	766	840	871	104	13.6
Cultural services	2,436	2,681	2,644	209	8.6
Environmental services	5,511	5,806	5,939	427	7.8
Planning and development services	2,061	2,105	2,106	45	2.2
Police services	13,607	14,595	14,618	1,011	7.4
Fire and rescue services	2,267	2,436	2,423	155	6.9
Central services	4,091	4,286	4,275	184	4.5
Other Services	255	229	184	-71	-27.7
Total Service Expenditure	107,051	113,554	113,540	6,489	6.1
plus precepts, levies, trading accounts and adjustments
Housing Benefits	13,907	13,377	13,349	-558	-4.0
Parish Precepts	618	619	659	41	6.6
Levies	-13	-209	-20	-7	53.2
Trading Accounts and Other Adjustments	-433	-232	-274	159	-36.7
Total Net Current Expenditure	121,129	127,108	127,254	6,125	5.1
plus non-current expenditure
Capital financing [note 2][note 3]	5,482	5,423	5,853	370	6.8
Capital expenditure charged to Revenue Account (CERA)[note 3]	2,426	3,168	2,842	416	17.2
Flexible use of Capital Receipts	-88	-145	-131	-42	47.8
Capitalisation by a direction under Section 16(2)b [Note 4]	-69	…	…	…	…
Provision for bad debts	133	254	209	75	56.5
Flood defence payments to Environment Agency	39	40	41	2	4.3
Private Finance Initiative (PFI) schemes - difference from service charge	-2	80	94	96	-4,590.4
Appropriations to(+)/ from(-) financial instruments adjustment account	-11	23	35	46	-406.8
Appropriations to(+)/ from(-) unequal pay back pay account	14	0	-3	-17	-117.9
less interest         receipts	1,610	2,530	2,599	989	61.4
less specific         grants outside         AEF[note 5]	15,230	15,190	15,197	-34	-0.2
less Business         Rates         Supplement	323	283	283	-40	-12.5
less         Community         Infrastructure         Levy (CIL)	413	436	446	33	8.0
less Carbon         Reduction         Commitment	0	-1	5	5	5,486.0
Appropriations to(+)/from(-) dedicated schools grant adjustment account	-300	-321	-245	55	-18.3
Revenue Expenditure	111,177	117,186	117,370	6,193	5.6

Notes:

1. Net of sales, fees and charges and net of recharges and funding from other local authorities or delivery bodies such as from the NHS (e.g. via the Better Care Fund). The RO3 table shows this within ‘Other income’ as well as in local authority gross expenditure.
2. Includes provision for repayment of principal, leasing payments, external interest payments and HRA item 8 interest payments and receipts.
3. The revision upwards of capital financing and downwards of CERA follows from a revision received in the return from the Greater London Authority.
4. We do not present an estimate for ‘Capitalisation by a direction under Section 16(2)b’ because only a small number of local authorities will have values to report for this (see the table at the bottom of capitalisation directions), and we do not yet have Revenue Outturn 2022-23 data for all of these authorities, for example Thurrock which is the largest.
5. Aggregate External Finance; see Definitions in the Technical Note. Specific grants outside Aggregate External Finance have been falling over recent years due to the move from Housing Benefit, which passes through local authorities’ Revenue Accounts (outside of Service Expenditure), to Universal Credit.

Table 2b:
Revenue Expenditure components Summary, England, 2021-22 and 2022-23

£ million - adjusted for inflation, in 2022-23 prices

Service Category	Net current expenditure [Note 1] 2021-22 final	Net current expenditure [Note 1] 2022-23 first release	Net current expenditure [note 1] 2022-23 second release	Actual change between 2021-22 and 2022-23	Percentage change between 2021-22 and 2022-23
Education services	37,164	37,212	37,125	-39	-0.1
Highways and transport services (excl. GLA)	3,193	3,083	3,125	-68	-2.1
Highways and transport services (GLA only)	2,493	1,653	1,653	-840	-33.7
Children’s Social Care services	12,023	12,785	12,805	783	6.5
Adult Social Care services	20,238	20,570	20,517	278	1.4
Public Health services	4,515	3,872	3,851	-664	-14.7
Housing services (excluding Housing Revenue Account)	2,324	2,240	2,274	-51	-2.2
including:
Homelessness         Reduction Act         duties	335	368	367	32	9.6
Homelessness:         all other	818	840	871	53	6.5
Cultural services	2,598	2,681	2,644	46	1.8
Environmental services	5,879	5,806	5,939	59	1.0
Planning and development services	2,199	2,105	2,106	-92	-4.2
Police services	14,515	14,595	14,618	103	0.7
Fire and rescue services	2,419	2,436	2,423	4	0.2
Central services	4,364	4,286	4,275	-89	-2.0
Other Services	272	229	184	-88	-32.2
Total Service Expenditure	114,197	113,554	113,540	-657	-0.6
plus precepts, levies, trading accounts and adjustments
Housing Benefits	14,835	13,377	13,349	-1,486	-10.0
Parish Precepts	659	619	659	-1	-0.1
Levies	-14	-209	-20	-6	43.6
Trading Accounts and Other Adjustments	-462	-232	-274	188	-40.7
Total Net Current Expenditure	129,216	127,108	127,254	-1,962	-1.5
plus non-current expenditure
Capital financing [Note2]	5,848	5,423	5,853	4	0.1
Capital expenditure charged to Revenue Account (CERA)	2,588	3,168	2,842	254	9.8
Flexible use of Capital Receipts	-94	-145	-131	-36	38.6
Capitalisation by a direction under Section 16(2)b [Note 3]	-74	…	…	…	…
Provision for bad debts	142	254	209	66	46.7
Flood defence payments to Environment Agency	41	40	41	-1	-2.2
Private Finance Initiative (PFI) schemes - difference from service charge	-2	80	94	96	-4,309.40
Appropriations to(+)/ from(-) financial instruments adjustment account	-12	23	35	47	-387.6
Appropriations to(+)/ from(-) unequal pay back pay account	15	0	-3	-18	-116.8
less interest         receipts	1,717	2,530	2,599	882	51.3
less specific         grants outside         AEF [note 4]	16,247	15,190	15,197	-1,050	-6.5
less Business         Rates         Supplement	345	283	283	-62	-18
less         Community         Infrastructure         Levy (CIL)	440	436	446	6	1.3
less Carbon         Reduction         Commitment	0	-1	5	5	5,136.50
Appropriations to(+)/from(-) dedicated schools grant adjustment account	-320	-321	-245	75	-23.4
Revenue Expenditure	118,598	117,186	117,370	-1,228	-1.0

Notes:

1. Net of sales, fees and charges and net of recharges and funding from other local authorities or delivery bodies such as from the NHS (e.g. via the Better Care Fund). The RO3 table shows this within ‘Other income’ as well as in local authority gross expenditure.
2. Includes provision for repayment of principal, leasing payments, external interest payments and HRA item 8 interest payments and receipts.
3. The revision upwards of capital financing and downwards of CERA follows from a revision received in the return from the Greater London Authority.
4. We do not present an estimate for ‘Capitalisation by a direction under Section 16(2)b’ because only a small number of local authorities will have values to report for this (see the table at the bottom of capitalisation directions), and we do not yet have Revenue Outturn 2022-23 data for all of these authorities, for example Thurrock which is the largest.
5. Aggregate External Finance; see Definitions in the Technical Note. Specific grants outside Aggregate External Finance have been falling over recent years due to the move from Housing Benefit, which passes through local authorities’ Revenue Accounts (outside of Service Expenditure), to Universal Credit.

Chart A illustrates proportions of expenditure by Service. Education and Social Care services combined continue to represent over half of all local authority service expenditure.

Chart A: Proportion of budgeted service expenditure by service, England, 2022-23

(a) ‘Other’ includes Public Health, Fire and Rescue, Housing, Central and Other Services.

Housing benefits

Although not part of Service Expenditure, Housing Benefits are a large component of total local authority spending. Paid by local councils to help individuals currently on low incomes to pay for rents for both private and social housing, these are financed through subsidies from the Department for Work and Pensions (DWP). Housing Benefits expenditure was £13.3 billion in 2022-23, £558 million (4%) lower than in 2021-22 (not adjusted for inflation). There was a corresponding decrease in subsidies received by local authorities, and this is reflected in the ‘Grants outside Aggregate External Finance (AEF)’ category. Decreases in this category have resulted from the transition to Universal Credit, whose funds do not pass through local authorities.

Expenditure and income

Expenditure lines in the summary tables in this release, such as in ‘Total Service Expenditure’ and each of the individual service areas, are net current expenditure i.e. expenditure minus relevant income.

Tables 3a and 3b show:

a) Total (gross) Expenditure and
b) Service specific income for each service line - which is composed of:

• sales, fees and charges, and

• ‘other income’; this comprises transfers from other local authorities and other delivery bodies, and costs reimbursed e.g. from DWP for temporary accommodation. The Service Expenditure Summary (RSX) table also contains the categories, as well as splitting Total expenditure into ‘employee costs’ and other costs, referred to as ‘running expenses’.

For each service category, the tables 3a and 3b shows the extent to which a net change in spend in a specific service area is due to change in total expenditure or due to a change in the service-specific forms of income.

Sales, Fees and Charges income was lower during the COVID-19 pandemic. This was particularly noticeable during 2020-21 but was also still a factor during 2021-22. This was evident in levels of income from transport fares and fees, parking charges, and charges for leisure and cultural services. A compensation scheme covered the period April 2020 to June 2021.

Table 3a:
Expenditure, income and total service expenditure, England, 2021-22 and 2022-23

£ million - not adjusted for inflation

Service Category	Gross expenditure 2021-22	Sales, fees and charges 2021-22	Other income 2021-22	Gross expenditure 2022-23	Sales, fees and charges 2022-23	Other income 2022-23	Gross expenditure change between 2021-22 to 2022-23	Sales, fees and charges change between 2021-22 to 2022-23	Other income change between 2021-22 to 2022-23
Education	39,474	1,669	2,967	41,998	1,830	3,043	2,523	161	75
Highways and transport	9,602	2,482	1,789	9,653	2,726	2,148	50	244	359
Highways and transport excluding GLA [note 1]	6,439	2,482	963	6,877	2,726	1,026	439	244	63
Children’s Social Care	12,248	182	795	13,886	178	903	1,638	-5	107
Adult Social Care [note 2]	27,257	3,342	4,942	29,016	3,611	4,888	1,759	269	-54
Public Health	4,556	23	302	4,149	35	264	-407	12	-38
Housing (excluding HRA [note 3])	3,890	965	747	4,048	1,046	729	158	81	-18
Cultural	3,599	672	490	4,005	877	484	407	205	-6
Environmental	7,781	1,473	798	8,407	1,582	887	626	109	89
Planning and development	3,772	1,044	667	3,875	1,010	759	103	-35	92
Police	14,999	600	791	16,079	587	874	1,081	-13	83
Fire and rescue	2,434	55	112	2,600	52	124	166	-2	13
Central [note 4]	12,554	1,237	7,226	13,425	1,321	7,829	871	84	603
Other	541	93	193	519	156	179	-22	62	-13
Total Service Expenditure	142,708	13,838	21,820	151,660	15,009	23,111	8,952	1,172	1,291

Notes:

1. Transport for London fares income does not show in Highways & Transport Sales, Fees and Charges, because TfL is a subsidiary company of the Greater London Authority. Consequently ‘gross expenditure’ reported by the GLA is lower than it otherwise would be, because fare income has effectively already been netted off. This is a general point and not specific to the period of the COVID pandemic.
2. Further aggregates of Adult Social Care Expenditure can be found in NHS Digital’s Adult Social Care – Activity and Finance Report. The 2022-23 edition was first released in October 2023 and was updated in December 2023.
3. Housing Revenue Account.
4. Most of the ‘Other Income’ (£7.3 billion in 2021-22 and £7.8 billion in 2022-23) recorded against ‘Central Services’ is in fact removing what would otherwise be double counting of recharges of ‘management and support services’ to more specific service categories, and income from other local authorities e.g. for shared services arrangements.

Table 3b:
Expenditure, income and total service expenditure, England, 2021-22 and 2022-23

£ million - adjusted for inflation

Service Category	Gross expenditure 2021-22	Sales, fees and charges 2021-22	Other income 2022-23	Gross expenditure 2022-23	Sales, fees and charges 2022-23	Other income 2022-23	Gross expenditure change between 2021-22 to 2022-23	Sales, fees and charges change between 2021-22 to 2022-23	Other income change between 2021-22 to 2022-23
Education	42,110	1,780	3,165	42,913	1,826	3,875	803	46	710
Highways and transport	10,243	2,649	1,908	9,704	2,750	2,218	-540	101	309
Highways and transport excluding GLA [note 1]	6,869	2,649	1,027	6,928	2,750	1,096	60	101	69
Children’s Social Care	13,066	195	849	13,870	192	893	804	-3	45
Adult Social Care [note 2]	29,076	3,566	5,258	29,041	3,644	4,827	-35	78	-430
Public Health	4,859	24	322	4,169	33	264	-690	8	-57
Housing (excluding HRA [note 3])	4,156	1,028	796	4,098	1,068	789	-58	40	-7
Cultural	3,843	717	521	4,064	871	513	222	154	-8
Environmental	8,302	1,567	852	8,343	1,631	907	41	64	55
Planning and development	4,015	1,112	705	3,851	1,004	741	-164	-107	36
Police	16,000	640	844	16,054	589	870	54	-52	26
Fire and rescue	2,596	58	119	2,610	52	122	14	-6	3
Central [note 4]	13,397	1,320	7,710	13,396	1,329	7,781	-1	8	71
Other	569	100	205	563	120	214	-6	21	8
Total Service Expenditure	152,231	14,756	23,254	152,676	15,109	24,014	445	353	760

Notes:

1. Transport for London fares income does not show in Highways & Transport Sales, Fees and Charges, because TfL is a subsidiary company of the Greater London Authority. Consequently ‘gross expenditure’ reported by the GLA is lower than it otherwise would be, because fare income has effectively already been netted off. This is a general point and not specific to the period of the COVID pandemic.
2. Further aggregates of Adult Social Care Expenditure can be found in NHS Digital’s Adult Social Care – Activity and Finance Report. The 2022-23 edition was first released in October 2023 and was updated in December 2023.
3. Housing Revenue Account.
4. Most of the ‘Other Income’ (£7.3 billion in 2021-22 and £7.8 billion in 2022-23) recorded against ‘Central Services’ is in fact removing what would otherwise be double counting of recharges of ‘management and support services’ to more specific service categories, and income from other local authorities e.g. for shared services arrangements.

Revenue expenditure financing

This section outlines the key sources of funding available to local authorities to finance their spending and how these differ for 2022-23 compared to 2021-22. Any income that authorities received from sales, fees and charges, and grants passed on from a third party, are already netted off in the net current expenditure figures presented in this document. In addition to these, the main sources of funding available to finance revenue expenditure are locally retained business rates, Council Tax, government grants, and when there is a net use of reserves.

Adjustments to financing items

A number of adjustments have been made to Tables 4, 5 and 6 to remove any effects to grants and reserves totals that are just as a result of their recording and unusual timing. These relate to:

i) Two grant payments made to local authorities at the very end of 2019-20.

ii) Legal requirements relating to payments of business rates income among local authorities, along with accountancy regulations and the timing of grants compensating local authorities for additional COVID-19 business rates reliefs in 2020-21 and 2021-22. Accountancy regulations require that COVID-19 business rates relief grant income received in 2020-21 and 2021-22, including COVID-19 Additional Relief Fund (CARF) are included in local authorities’ revenue accounts. These are shown in their ‘other earmarked reserves’ until the following year when they compensate for what would otherwise be lower retained business rates income.

In relation to i):

• Where authorities included in their Revenue Outturn 2019-20 receipt of tranche 1 of COVID-19 emergency general grant that was paid in March 2020, this is treated as if it had been received in 2020-21.

• Where authorities included in their Revenue Outturn 2019-20 regular business rates relief grant income that was brought forward to March 2020, this is netted off for 2019-20. Regular business rates relief grants feed into the final amount of retained business rates income in their 2020-21 Revenue Outturn return.

And in relation to ii):

• In the year when the compensatory grants were received, the reported amounts are netted off from: a) total grants, b) reserves movements and c) the reserve levels at the end of the year.

• The amounts reported in the following year’s figures are netted off from the reserve levels at the start of the year and adjusted from the movement out of reserves. The amounts are instead shown in the Retained Income from the Business Rates Retention Scheme line. Further details can be found in the accompanying technical notes.

Revenue expenditure financing in 2021-22 and 2022-23

Tables 4a and 4b show the funding of revenue expenditure by detailed category in 2021-22 and 2022-23. Analysis of these figures is included in the following section.

Table 4a: Revenue expenditure financing, England, 2021-22 and 2022-23

£ million - not adjusted for inflation

Service Category	Net current expenditure 2021-22	Net current expenditure 2022-23 first release	Net current expenditure 2022-23 second release	Change £	Change %
Revenue expenditure	111,177	117,186	117,370	6,193	5.6
Financed by: Government Grants	66,483	61,956	62,573	-3,910	-5.9
Remove 2021-22 COVID-19 business rates relief grants, including CARF [note 1]	3,433	[z]	[z]	[z]	[z]
Government Grants adjusted	63,049	61,956	62,573	-476	-0.8
of which:     Specific grants     inside AEF     [note 2]	50,303	51,550	52,165	1862	3.7
including:         Dedicated         Schools Grant         (DSG)	27,810	28,799	28,884	1073	3.9
Public Health         Grant [note 3]	3,109	3,195	3,195	86	2.8
Pupil Premium         Grant	1,184	1,028	1,215	30	2.6
New Homes         Bonus	622	550	551	-71	-11.4
Local Services     Support Grant     (LSSG)	28	33	35	8	28.5
Revenue     Support Grant	1,622	1,674	1,673	52	3.2
Police grant	8,228	8,700	8,699	471	5.7
Sales, Fees and Charges Compensation Scheme	167	[z]	[z]	[z]	[z]
COVID-19 Expenditure Pressures Grant	1,589	[z]	[z]	[z]	[z]
Tax Income Guarantee	455	[z]	[z]	[z]	[z]
Local Council Tax Support Grant 2021-22	658	[z]	[z]	[z]	[z]
Council tax requirement	34,434	36,313	36,313	1,878	5.5
Retained income from Business Rate Retention Scheme [note 4, 5]	17,663	16,650	16,426	-1,237	-7.0
Of which:     COVID-19     business rates     reliefs grants     from reserves     [note 6]	5,877	2,926	2,883	-2,994	-50.9
Adjusted appropriations to(-) / from (+) revenue reserves [note 7, 8]	-3,094	2,274	2,061	5,155	-166.6
of which:
Appropriations     to (-) / from (+)     Schools’     reserves	-150	192	182	332	-221.1
Appropriations     to (-) / from (+)     Dedicated     Schools Grant     reserves	[z]	[z]	[z]	[z]	[z]
Appropriations     to (-) / from (+)     Public Health     reserves	-147	-30	-29	118	-80.5
Appropriations     to (-) / from (+)     Other     Earmarked     reserves     (adjusted)	-2,527	1,740	1,440	3967	-157
Appropriations     to (-) / from (+)     unallocated     reserves	-260	515	419	678	-261.1
Appropriations     to (-) / from (+)     Dedicated     schools grant     adjustment     account	[z]	[z]	[z]	[z]	[z]
Council tax collection fund surplus (+) / deficit (-) [note 8]	-567	92	104	671	-118.4
Other items	-357	-118	-62	294	-82.6

Notes:

1. Comprises expanded retail discount and COVID-19 Additional Relief Fund (CARF) in 2021-22. Amounts are as reported in these returns. These are lower than the grant totals since some authorities removed these amounts. Adjusted measures are unaffected because we net off only the amounts that were not removed.
2. Specific grants inside AEF also includes the following grants: Private Finance Initiative (PFI), Universal Infants Free School Meals, Housing Benefit Subsidy and Council Tax Support Admin Grant, and all Other grants inside AEF. Please see the Specific and Special Revenue Grants data table (‘RG’) for more detail.
3. Public Health Grant allocations for the Metropolitan Districts of Greater Manchester are not reflected due to the devolution deal for the Greater Manchester area.
4. Accountancy regulations required compensatory COVID business rate relief grants that were paid in 2020-21 and 2021-22 to be recorded in reserves until they were used, typically in the following year. In order to assist interpretation, this table is adjusted so that the amount being used are removed from appropriations from reserves, and instead recorded within the total of Retained income from the Business Rates Retention.
5. Business rates income is reported as a single item in this data set; as such, it is verifiable only within the balance between revenue expenditure and financing items. See also the data provided by local authorities in detailed data returns on non-domestic rates.
6. Figures are as reported in these data returns. While a minority of authorities under-reported in this sub-category, the other measures (except those marked as ‘unadjusted’) in this and other tables are not affected by this.
7. Use of Reserves includes all appropriations to (-) and from (+) Revenue Account Reserves.
8. Movements to and from reserves have been adjusted for timing effects to make them as comparable as possible over time.
9. Council Tax collection fund surplus/deficit includes net collection fund surplus/deficits from the previous year.

[z] Not applicable for this year.

Table 4b: Revenue expenditure financing, England, 2021-22 and 2022-23

£ million - adjusted for inflation

Service Category	Net current expenditure 2021-22	Net current expenditure 2022-23 first release	Net current expenditure 2022-23 second release	Change £	Change %
Revenue expenditure	118,598	117,186	117,370	-1,228	-1.0
Financed by: Government Grants	70,921	61,956	62,573	-8,348	-11.8
Remove 2021-22 COVID-19 business rates relief grants, including CARF [note 1]	3,663	[z]	[z]	[z]	[z]
Government Grants adjusted	67,258	61,956	62,573	-4,685	-7.0
of which:     Specific grants     inside AEF     [note 2]	53,661	51,550	52,165	-1,496	-2.8
including:         Dedicated         Schools Grant         (DSG)	29,667	28,799	28,884	-783	-2.6
Public Health         Grant [note 3]	3,317	3,195	3,195	-122	-3.7
Pupil Premium         Grant	1,263	1,028	1,215	-49	-3.9
New Homes         Bonus	664	550	551	-113	-17
Local Services     Support Grant     (LSSG)	29	33	35	6	20.5
Revenue     Support Grant	1,730	1,674	1,673	-56	-3.3
Police grant	8,777	8,700	8,699	-78	-0.9
Sales, Fees and Charges Compensation Scheme	178	[z]	[z]	[z]	[z]
COVID-19 Expenditure Pressures Grant	1,695	[z]	[z]	[z]	[z]
Tax Income Guarantee	486	[z]	[z]	[z]	[z]
Local Council Tax Support Grant 2021-22	702	[z]	[z]	[z]	[z]
Council tax requirement	36,733	36,313	36,313	-420	-1.1
Retained income from Business Rate Retention Scheme [note 4, 5]	18,843	16,650	16,426	-2,416	-12.8
Of which:     COVID-19     business rates     reliefs grants     from reserves     [note 6]	6,269	2,926	2,883	-3,386	-54
Adjusted appropriations to(-) / from (+) revenue reserves [note 7, 8]	-3,300	2,274	1,816	5,117	-155.0
of which:
Appropriations     to (-) / from (+)     Schools’     reserves	-160	192	182	342	-213.5
Appropriations     to (-) / from (+)     Dedicated     Schools Grant     reserves	[z]	[z]	[z]	[z]	[z]
Appropriations     to (-) / from (+)     Public Health     reserves	-156	-30	-29	128	-81.7
Appropriations     to (-) / from (+)     Other     Earmarked     reserves     (adjusted)	-2,695	1,740	1,440	4,135	-153.4
Appropriations     to (-) / from (+)     unallocated     reserves	-277	515	419	696	-251
Appropriations     to (-) / from (+)     Dedicated     schools grant     adjustment     account	[z]	[z]	[z]	[z]	[z]
Council tax collection fund surplus (+) / deficit (-) [note 8]	-604	92	104	708	-117.2
Other items	-380	-118	-62	318	-83.7

Notes:

1. Comprises expanded retail discount and COVID-19 Additional Relief Fund (CARF) in 2021-22. Amounts are as reported in these returns. These are lower than the grant totals since some authorities removed these amounts. Adjusted measures are unaffected because we net off only the amounts that were not removed.
2. Specific grants inside AEF also includes the following grants: Private Finance Initiative (PFI), Universal Infants Free School Meals, Housing Benefit Subsidy and Council Tax Support Admin Grant, and all Other grants inside AEF. Please see the Specific and Special Revenue Grants data table (‘RG’) for more detail.
3. Public Health Grant allocations for the Metropolitan Districts of Greater Manchester are not reflected due to the devolution deal for the Greater Manchester area.
4. Accountancy regulations required compensatory COVID business rate relief grants that were paid in 2020-21 and 2021-22 to be recorded in reserves until they were used, typically in the following year. In order to assist interpretation, this table is adjusted so that the amount being used are removed from appropriations from reserves, and instead recorded within the total of Retained income from the Business Rates Retention.
5. Business rates income is reported as a single item in this data set; as such, it is verifiable only within the balance between revenue expenditure and financing items. See also the data provided by local authorities in detailed data returns on non-domestic rates.
6. Figures are as reported in these data returns. While a minority of authorities under-reported in this sub-category, the other measures (except those marked as ‘unadjusted’) in this and other tables are not affected by this.
7. Use of Reserves includes all appropriations to (-) and from (+) Revenue Account Reserves.
8. Movements to and from reserves have been adjusted for timing effects to make them as comparable as possible over time.
9. Council Tax collection fund surplus/deficit includes net collection fund surplus/deficits from the previous year.

[z] Not applicable for this year.

Revenue expenditure financing trend over recent years

Table 5 shows funding of revenue expenditure since 2018-19 in terms of the broad categories of government grants and locally retained income (retained income from rate retention scheme and Council Tax), as well as whether overall local authorities have made net appropriations to or from reserves.

Changes since 2019-20

The broader measure of local authority Revenue Expenditure (see Definitions section) totalled £117.4 billion across all local authorities in England in 2022-23. In real terms, this is 1.0% lower than in 2021-22 and 7.1% higher than in 2019-20.

The large increase in revenue expenditure from 2019-20 to 2020-21 (+9.2% in real terms), was predominantly financed by increased central government grants. The following figures are all in cash terms, i.e. not adjusted for inflation: Central government grants (adjusted, notably removing COVID-19 business rate relief compensatory grants) financed £65.7 billion of local authority revenue expenditure in 2020-21, up from £48.4 billion in 2019-20, largely reflecting increased funding due to the impact of COVID-19. In 2021-22, the comparable (adjusted) grants total was £63.1 billion; this was lower because there was less COVID grant funding in 2021-22 than in 2020 21. In 2022-23, government grants totalled £62.5 billion.

Longer term changes

From 2014-15 onwards local authorities have been more reliant on locally retained income because business rates moved from being a centrally redistributed function to one where authorities retain a percentage of what they collect.

The proportion of revenue expenditure (excluding use of reserves and council tax collection fund surplus) funded from grants had fallen from 65.4% in 2013-14 to 49.9% in 2019-20, with corresponding increases in the income retained by local authorities. Since 2017-18, some authorities have been able to retain more than a 50% share of local business rates revenue in deals foregoing particular grants. Additionally, single year rate retention pilots took place in 2017-18, 2018-19 and 2019-20, where different authorities and different percentage shares were involved. This led to a marked increase in retained business rates income and a similar decrease in Revenue Support Grant income in these years.

In 2020-21, local authorities received additional grant funding in response to COVID-19 which increased the proportion of revenue expenditure funded from grants to 56.8%. In 2022-23, this was at 54.3%.

The increases over the year in Council tax requirement is the result of the combination of growth in tax base and in levels of council tax.

Table 5: Financing of revenue expenditure, England, since 2018-19

£ million - not adjusted for inflation

Outturn	Revenue expenditure	Government grants (adjusted) [Note 1]	% of Total [Note 2]	Retained income from Business Rate Retention Scheme [Note 3]	Of which: COVID-19 business rates relief grants from reserves [Note 4]	Council Tax	Locally retained income	% of Total [Note 2]	Adjusted use of reserves [Note 5, 6]	Council Tax collection fund surplus and Other items [Note 7
2018-19	94,226	48,076	50.3	17,973	[z]	29,563	47,536	49.7	-1,878	513
2019-20	98,178	48,393	49.9	17,216	[z]	31,452	48,669	50.1	766	350
2020-21	109,639	65,720	56.8	16,865	[z]	33,141	50,006	43.2	-6,189	143
2021-22	111,177	63,049	54.8	17,663	5,877	34,434	52,098	45.2	-3,094	-923
2022-23	117,370	62,573	54.3	16,426	2,883	36,313	52,739	45.7	2,061	42

Notes:

1. Includes non-specific grants like COVID grants (excluding business rate relief grants), Revenue Support Grant and Police Grant as well as all the various ‘Specific grants inside aggregate external finance’.
2. As a percentage of total expenditure excluding use of reserves and Council Tax Collection Fund surplus and other items.
3. Business rates income is reported as a single item in this data set; as such, it is verifiable only within the balance between revenue expenditure and financing items. See also the data provided by local authorities in detailed data returns on non-domestic rates.
4. As noted, a minority of authorities under-reported in this sub-category but this should not have affected the other figures.
5. Use of Reserves includes all appropriations to (-) and from (+) Revenue Account Reserves.
6. Movements to and from reserves have been adjusted for timing effects to make them as comparable as possible over time.
7. A number of authorities reported charges in 2021-22 in respect of collection fund deficits.

[z] Not applicable for this year.

Reserves

Reserves are funds set aside to finance future expenditure, often for liabilities, expected pressures or other contingencies.

Table 6 shows the level of authority revenue reserves from 2018-19 to 2022-23. The Housing Revenue Account (HRA) also has reserves figures although these are not included in this table because there are separate.

As noted in the section ‘Revenue Expenditure Financing’, reserves figures in the summary tables in this publication are presented adjusted for timing effects of grants relating to COVID, particularly additional business rates relief grants. This is so that the figures are as comparable as possible to other periods.

There have nevertheless been larger than usual discrepancies since 2020-21, for example between reported reserves levels at the end of one financial year and the start of the next.

Notwithstanding these data quality considerations, it is clear that local authority reserves increased during the period of the COVID-19 pandemic. Revenue Account non-ringfenced reserves are estimated to have:

• totalled £31.6 billion at 31 March 2023, compared to £23.5 billion at 31 March 2020, but

• decreased by £1.8 billion from £33.4 billion at 1 April 2022 to £31.6 billion at 31 March 2023.

Table 6: Level of revenue reserves, England, since 2018-19

£ million - not adjusted for inflation

Outturn	Schools reserves	Dedicated schools grant adjustment account level	Dedicated Schools Grant (DSG) reserves [Note 2]	Public Health reserves	Adjusted Other earmarked reserves [Note 1]	Unallocated reserves	Adjusted Non-ringfenced reserves Total [Note 1]	Adjusted Total (excluding DSG) reserves [Note 1, 2]
At 1 April:
2018	1,596	[G]	132	235	17,711	4,261	21,972	23,803
2019	1,582	[G]	6	231	19,427	4,220	23,624	25,459
2020	1,521	[G]	-364	216	20,125	4,674	24,800	26,537
2021	2,133	[G]	-61	387	25,948	5,194	31,142	33,662
2022	2,292	[G]	[G]	539	27,915	5,484	33,399	36,230
At 31 March:
2019	1,612	[G]	-8	236	19,709	4,264	23,973	25,821
2020	1,429	[G]	-397	212	18,774	4,681	23,455	25,096
2021	2,136	[G]	-267	381	24,555	5,479	30,034	32,551
2022	2,283	[G]	-50	533	28,475	5,454	33,929	36,745
2023	2,110	[G]	[G]	568	26,488	5,065	31,553	34,231
Changes in 2022-23
Movements to (+) and from (-) reserves	-182	[G]	[G]	29	-1,428	-419	**-1,846 **	-2,000
as a percentage of 1 April 2022	-7.90%	[G]	[G]	5.30%	-5.10%	-7.60%	-5.5%	-5.5%
England reserves excluding Greater London Authority
Movements to (+) and from (-) reserves	-182	[G]	[G]	29	-1,149	-187	690	536
as a percentage of 1 April 2022	-7.90%	[G]	[G]	5.30%	-4.40%	-3.80%	2.2%	1.6%

Notes:

1. Movements to/from reserves and reserves levels have been adjusted for timing effects to make them as comparable as possible over time.
2. Dedicated Schools Grant was introduced in this return in 2018-19. It was previously collected and continues to be collected in the Department for Education’s Section 251 returns.

[G]. A new category of reserves levels ‘Dedicated Schools Grant Adjustment Account’ was introduced for 2022-23. Authorities should report deficits in the new category, and surpluses in ‘Dedicated Schools Grant Reserves’, as per accounting regulations. Previously many authorities reported both in the latter category, and the data for 2022-23 indicate that some authorities have not yet reported using the categories correctly. Consequently no England estimate has been made for 2022-23 for either category.

Accompanying tables

Tables

Accompanying tables presenting detailed revenue expenditure and financing figures for 2022-23 for all returns from local authorities received in time for this publication are available to download alongside this release.

These tables present all revenue information, by local authority, in a similar format as returned to the Department for Levelling Up, Housing and Communities. This data forms the basis of the tables in this release.

Description	Form
Revenue Outturn Summary	RS
Service Expenditure Summary	RSX
Specific and Special Revenue Grants	RG
Education Services	RO1
Highways and Transport Services	RO2
Social Care and Public Health	RO3
Housing Services	RO4
Cultural, Environmental, Regulatory and Planning Services	RO5
Protective, Central and Other Services	RO6
Trading Services Revenue Account	TSR
Subjective Analysis Return – part A – employee costs	SAR-A

Subjective Analysis Return parts B & C are undergoing further validation and their publication is expected by February 2024.

Publication of more granular data on grant income reported in RO2022-23 is planned for early 2024.

Accompanying tables and open data

Symbols used

…   =   not available
0    =   zero or negligible
[z]     =   not applicable for this year
(R)  =   Revised since the last statistical release

Rounding

Where figures have been rounded, there may be a slight discrepancy between the total and the sum of constituent parts.

Accredited Official Statistics status

These statistics are Accredited Official Statistics. This status means that these statistics comply with the highest standards of trustworthiness, quality and public value as set out in the Code of Practice for Statistics. Accredited official statistics are called National Statistics in the Statistics and Registration Service Act 2007.

Information on Official Statistics is available via the UK Statistics Authority website.

Information about statistics at DLUHC is available via the Department’s website .

Technical Notes

Please see the accompanying technical notes document for further details.